When Dealing with the Documentation of Internal Control

question 36

Multiple Choice

When dealing with the documentation of internal control,

• A) in a narrative, most questions simply require a "yes" or "no" response.
• B) questionnaires offer useful checklists to remind the auditor of the many different types of internal controls that should exist.
• C) questionnaires and flowcharts should not be used together.
• D) flowcharts fail to show the segregation of duties in the company.

---

Definitions:

Expected Rate of Return

The anticipated return on an investment, calculated as the weighted average of the possible returns based on their probabilities.

Growth Rate

The measure of a company's or an economy's increase in its revenue, earnings, or asset size over a given period, often expressed as a percentage.

Stock Market

A public market for the trading of company stocks and derivatives at agreed prices, often considered a critical indicator of the economic health of a country.